The nationalised, private and cooperative banks operating in Odisha were on Monday asked by the State Government to expedite financial inclusion by bringing in uncovered villages and households to its fold.
They were also asked to enhance credit and its utilisation in the Sate during the current financial year.
The banks were asked to adopt such measures at the State-level Banking Committee (SlBC) meeting held here. Addressing the meeting, Minister of Finance Paradip Kumar Amat said the rapid industrialisation and urbanisation in the State during last decade has opened new avenues for expansion of the banking sector. The deposit ratio in the State has also increased over the years, and as such the banks should expedite their activities for wider financial inclusion and higher investment in the State.
An MoU was signed between the State Government and the SlBC on behalf of the banks for direct transfer to funds to the accounts of the MGNREGS beneficiaries.
Chief Secretary Gokul Chandra Pati said banks should work out definite action plans for expanding banking correspondent model for quicker coverage of uncovered areas. They should utilise credible Primary Cooperative Societies, WSHGs, Common Service Centres, Rural Post Offices and PCOs as bank correspondents in uncovered remote areas.
Pati emphasised on flow of credit to the agriculture and allied sectors, particularly for fishery and animal resource development projects.
He said the banks have to help in a big way to make the State self-sufficient in freshwater fish production. He also mentioned about flow of credit to small and marginal farmers through the Joint liability Group (JIG) approach.
Pati also asked the banks to make a realistic assessment of the sickness of MSMEs as per the RBI guidelines and take necessary steps for activating them. He advised the banks to constitute a sub-committee of the SlBC to look into the reasons for the prevailing Non-Performing Assets (NPA) among SHGs and projects in the primary sector. The committee should come out with suggestive measures within a month, he said.
Additional Chief Secretary, Finance UN Behera asked the banks to report correct data about the credit-deposit ratios as they do not tally with the RBI reports. He emphasised on calculation of the ratio as per the deposit from the State and the credit advanced and utilised in the State.
The number of bank branches in Odisha up to June 2014 has increased to 4,338 recording a growth rate of 12.90 per cent over the corresponding period of last year. Three new places, Gopalpur, Gunupur and Dhamara, have been identified for establishment of new clearing houses. The deposit has also increased to Rs 1,70,527.24 crore recording a growth of 13.66 per cent over last year for the same period.
Though the CD ratio during 2014 has been around 79 per cent, it has shown a decreasing trend of around 7 per cent over last year. The banks were asked to cover this gap. Similarly, though the advances in priority sector have been 57 per cent as of June 2014 against the national norm of 40 per cent, there is a decline in the percentage of the priority sector advance to the total advances. The loans to MSMEs, minority communities and weaker sections have increased by 13%, 12% and 16%, respectively.
Each bank was asked to finance at least minimum 10 loans per branch to persons with disabilities under the DRO loan scheme.
Matters relating to utilisation of interest subvention, subsidy utilisation, direct benefit transfer and Aadhaar number seeding, extending credit to rice mills against pledge/hypothecation of paddy, recovery of loans, achievement of Annual Credit Plan (ACP) were discussed at the meeting.